Introduction

Canada has become one of the most preferred destinations for studying abroad for many Indian students. The reason is world-class education at a lower cost compared to most other countries.

But, what stops most students from applying is the lack of funds, which is why most students opt for an education loan abroad to study in Canada. This blog is aimed to help such students by giving an in-detail explanation of all procedures one has to follow while applying for an education loan for their studies in Canada. 

You can also know all about this in our episode of Loanflix, by our CEO, Damini Mahajan. 

Let's dive in and understand the timeline before a student lands in Canada for their studies. This can broadly be divided into 2 stages:

Stage 1, The Application Process:

This is pretty straightforward. You need to keep an eye on the tentative admission dates of the college/university they want to study in and apply accordingly. 

Stage 2, Funding & Visa Process:

  • Funding: None of the colleges/universities in Canada requires students to submit proof of funds/pay anything before their admission. This process is initiated only after the student has secured admission, after which the college/university will generally ask the students to pay the first term fee. You can either self-fund or take an education loan.
  • Visa process: This can be a stressful affair for students going to any country. One has to adhere to the stringent rules & regulations set by the respective country's embassy. Opening a GIC account is one of them.

First things first, Let us start by knowing the 

The right time to apply for an education loan for Canada.

It is mostly recommended that you apply for an education loan as soon as you get an 'Offer Letter' from your college. This will ensure enough buffer time for any kind of last-minute contingencies. For Ex: If the student is expected to start their course in Jan 2023, then it is recommended that they apply for an education loan by mid-July to early August. You can opt to add the GIC amount to the total education loan amount and take complete disbursement when required.

The usual timeline for Indian students going to Canada:

  • GIC Account Opening Process: Up To 1 week
  • Visa Process: 6 - 8 weeks
  • And the education loan disbursement process takes its own sweet time.

We know that taking an education loan is a crucial step in your life and that a lot of research and time goes into understanding all the terms and conditions of the loan. This is by the way very important for the applicant to know to maintain transparency throughout the education loan sanctioning process.

Moving ahead, I want you to have a clear idea of GIC and how it works.

How does a Guaranteed Investment Certificate or GIC account works?

A Guaranteed Investment Certificate or GIC is a bank account offered by Canadian Banks. A GIC is somewhat similar to a Fixed Deposit(FD) account in India. Students from India and other Student Direct Stream (SDS) countries have to deposit a minimum of 10,000 CAD into this account after which they will get a GIC Certificate. This money is treated as proof of funds and will be released to the students regularly, along with interest, after they land in Canada. The GIC is to prove to the Canadian Govt. that you can fund your expenses for the first 12 months in Canada. So, the GIC Certificate improves the chances of approval for a Canada Study Visa.

For Ex: When the student opens a GIC account in SBI Canada by depositing 10,000 CAD, 2,000 CAD will be released upon their arrival and the rest will be released in equal instalments over the next 12 months (667 CAD + interest).

Multiple banks offer the facility to open a GIC account for students planning to go to Canada for higher studies so that they can quickly get their visas and fly to Canada to fulfil their dream of studying abroad. A few of the most popular banks to open GIC accounts are:

1. SBI Canada Bank

GIC Amount: 10,000 CAD (min.)

Initial Deposit to students: 2,000 CAD

Program Fee: 150 CAD

Repayment Period: 12 instalments over 12 months

Monthly Deposit: 667 CAD + interest (approx.)

Docs required to activate the GIC account in Canada:

      • Passport
      • Study permit (i.e. IMM 1442) issued by the Canadian High Commission
      • Original letter of enrollment OR Student ID card
      • A printout of the Investment Declaration Advice issued by SBIC.

REFUND POLICY: The refund process might take up to 4 weeks and extra charges may be applicable.

2. Nova Scotia

GIC Amount: 10,000 CAD (min.) to 50,000 CAD (max.)

Initial Deposit to students: 2,000 CAD

Program Fee: 200 CAD

Repayment Period: 12 instalments over 12 months

Monthly Deposit: 667 CAD + interest (approx.)

Docs required to activate the GIC account in Canada:

      • The investment directions confirmation letter
      • Passport
      • Offer letter
      • The study permit & welcome letter.

REFUND POLICY: Docs & details required to be submitted online:

      1. Scotiabank Investment Account Number
      2. Wire Return bank account details
      3. The original case number and a letter stating the reason for applying for a refund

Once verified, Scotiabank will initiate the refund process and send a confirmation email along with the ICN ( Internal Control Number). This entire process may take up to 4 weeks. Extra charges are applicable for the refund process as per the Scotiabank GIC refund policy.

3. ICICI Bank Canada

GIC Amount: 10,000 CAD (min.)

Initial Deposit to students: 2,000 CAD

Program Fee: 150 CAD

Repayment Period: 12 instalments over 12 months

Monthly Deposit: 667 CAD + interest (approx.)

Docs required to activate the GIC account in Canada:

      • Passport
      • Study Permit
      • Barcode document (which you will receive by post)
      • Address proof.

REFUND POLICY: In case your application for a study permit is declined or you withdraw from your course, you can apply for a refund. The refund process might take up to 8 weeks and extra charges may be applicable.

4. CBIC

GIC Amount: 10,000 CAD (min.) to 20,000 CAD (max.)

Initial Deposit to students: 2,000 CAD

Program Fee: 150 CAD

Repayment Period: 11 instalments over 12 months

Monthly Deposit: 728 CAD + interest (approx.)

Docs required to activate the GIC account in Canada:

      • Passport,
      • Study permit,
      • Barcode document (which you will receive by post),
      • Address proof.

REFUND POLICY: In case your application for a study permit is declined or you withdraw from your course, you can apply for a refund. Extra charges may be applicable for the refund process as per CIBC GIC refund policy.

Now follow my lead to know the GIC account opening process in any of the Canadian banks. 

Note: You may submit this GIC certificate while applying for your Canada student visa, it will benefit you in the process.

Reimbursement process upon arriving in Canada

After you arrive in Canada, you are required to personally visit the respective Canadian bank in which you've opened your Canada GIC account, along with certain documents for a final verification procedure (KYC) and to activate your GIC account.

Post verification, a personal bank account (for daily banking purposes) will be created in the student’s name and 2,000 CAD will be deposited into this account, initially, for you to use. The balance amount of CAD 8,000 CAD will be deposited into a non-redeemable GIC account and will be given to you in regular instalments. For Ex: If you are getting the 8,000 CAD in 12 instalments over the next 12 months, each month 667 CAD (along with interest) will be deducted from the GIC and will be deposited in your bank account.

The process of applying for an education loan is already simple and it gets simpler when you process your loan with WeMakeScholars. We are here to help! You can get in touch with the financial officer by requesting a callback from them or click here to check your education loan eligibility.

FAQ

1. Does the education loan cover the GIC amount?

Yes. All banks and NBFCs that provide an education loan for Canada in India also cater to all GIC account-related expenses. 

2. Is the Canada GIC amount refundable?

Yes. Students can get their GIC account amount refunded in the following circumstances:

  • If their study permit has been declined, or
  • If their application for admission has been declined, or
  • If the student has withdrawn from enrolment into the respective university before/after arrival in Canada.

The Canada GIC refund policy implemented by any Canadian bank is mostly similar:

  • Students will be required to provide relevant documents supporting their reason for applying for the refund. Documents required to differ from lender to lender.
  • Once all the documents have been verified, banks will initiate the refund process and you'll get a confirmation email regarding the same. (some banks may levy extra charges upon cancelling the GIC).
  • The entire GIC refund process may take up to 4 weeks, approximately.

Thanks for reading this blog on GIC and Education loan Process for Canada. If you are interested in learning more about studying abroad and student life abroad, then I highly recommend you to read: